4-Hour Analysis:
Big Picture: We anticipated the price to be as it did. Now that we’ve broken through a big intraday resistance level, the next step is important. Price should ideally re-test and bounce off 40200-40500 in the intra-day session to confirm this level as support; doing so will extend the upside into 44200, followed by 44600. On a higher time frame, the price is contained within an ascending triangle with ranges ranging from 45050 to 37400. We are likely to trade in between these levels unless a breakout occurs.
On Upside the recovery continued towards 42k on break of 41200. Now for intra-day we have initial resistance at 42400 followed by 43150. If price breaks above these resistances then we are once more likely to test the major confluence resistance of 44200-45200. These combined levels of resistance have been capping the upside since early January. Furthermore, a strong breakout above these resistances is anticipated to open 48-50k as the next upside targets.
On the Downside 41200 is likely to be the first support level for the day followed by a stronger support region of 40500-40200. Ideally this level should not act as a shield to protect further downside. Doing so will help bulls recharge. However losing this would mean we go lower towards 39450, which is likely to weaken up the momentum and could drop further towards 38450 ending the upside in a dead-cat bounce.
